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Convenience Fee for CC Use (1 Viewer)

chet

chet

Footballguy
How do you feel about businesses that charge a convenience fee (~2.5%) for using a credit card?  At one point, I thought it was against the CC's rules but I see it often enough these days to not believe that anymore.  I ####### hate it.

 
chet said:
How do you feel about businesses that charge a convenience fee (~2.5%) for using a credit card?  At one point, I thought it was against the CC's rules but I see it often enough these days to not believe that anymore.  I ####### hate it.
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I think it's dumb by businesses to do this. Just add the 2.5% to the price, which will cover your credit card fees as a business, and those who pay cash nets you 2.5% more.

It's just silly and makes people mad.

 
My pizza place has a "cash price" and a "CC price". Depending on what you use, thats how the ring it up.

 
glvsav37 said:
My pizza place has a "cash price" and a "CC price". Depending on what you use, thats how the ring it up.
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Same for my local place in Brooklyn.

This will vary by state, but in NYS they cannot offer a higher price for CC transactions. But they can offer a cash discount. Six of one, half dozen of the other.

 
I don't like it but I support their business right to charge what they see fit and suffer whatever consequences may result.  

 
Depends on the business.  Large scale business such as anything with dedicated brick and mortar or multiple locations?  Shouldn't happen.  Don't like it.

Mom and pop shops or the local food truck?  I get it.  CC fees are eating in to their margins and I get why they would like to disincentivite CC transactions.

Look at it this way, you are getting rewards for using your CC, right?  How does the CC company make money to give you rewards?  Through the fees they are charging the merchant for the privelege of accepting your CC.  That's pretty shady and I don't feel bad when the local food truck makes me pay the fee to use my CC when I'm getting a portion of that back anyway.

 
Maybe over the phone or when the card isn’t present, but swiping the card or having the card present gives them the lowest rate possible.  

Cc processing and merchant services is a slimy biz.  

 
I hope this doesn't become prevalent but I can see why businesses do it. 

I will start not using my credit card at those places or not go.  

 
I get it because it is a convenience for me to not have to carry cash...but this day and age where seemingly every month there is a security breach where 55,000 people's credit card information is stolen i feel i should be charging the CC 2.5% for not keeping my info secure 

 
comfortably numb said:
I get it because it is a convenience for me to not have to carry cash...but this day and age where seemingly every month there is a security breach where 55,000 people's credit card information is stolen i feel i should be charging the CC 2.5% for not keeping my info secure 
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It’s also a convenience for them. They don’t have to carry as much cash, go to the  bank less, go through less change and Not have as much security because there is less cash on hand.  

 
This is one reason why cryptocurrency will eventually take over.   The overhead associated with credit card transactions is a lot more burden than people realize.   People only see the 1 percent cash back and think that is a lot, but not the 3-5 percent costs added to each transaction.   I am  not sure why people take it out on the businesses which make these costs transparent.  It is your  credit card company who is really charging the fee 

 
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What’s more annoying than the fees is the retailers with minimum purchase amounts for credit cards. I never carry cash, and there’s a few places near me (gas stations and such) that have $8 minimums for credit card transactions. 

 
Binky The Doormat said:
I hope this doesn't become prevalent but I can see why businesses do it. 

I will start not using my credit card at those places or not go.  
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Two types of places where credit card fees are a big burden. Places with mostly small transactions and places that have customers that have accounts with monthly billing. Will likely become the norm at these places barring some changes by CC companies. Everywhere else will likely not move this direction. 

 
Unfortunately, we the system is are grooming our kids to never touch cash anymore. (edited for clarity)

My kids elementary school has a lunch card that he swipes. Mommy sends in a check and it gets added to his balance. Kid has no idea how much or how little is on it...just swipe and eat. 

Also, look at video games at places like Dave & Busters, all card based. Swipe, play. Swipe, play. 

Gone are the days when you would sit at the table counting quarters out of a ziplok bag to see if you could get that extra cookie or go to the arcade. Kids dont have that physical connection to money anymore and I think it will be a huge detriment when it comes to their future spending and saving habits.  

I have to be careful around my kids and using my CC b/c a few times when my son wants something and I tell him "No, we don't have the money for that" he replies, "Can't you just use your credit card?" 

 
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glvsav37 said:
Unfortunately, we are grooming our kids to never touch cash anymore. 

My kids elementary school has a lunch card that he swipes. Mommy sends in a check and it gets added to his balance. Kid has no idea how much or how little is on it...just swipe and eat. 

Also, look at video games at places like Dave & Busters, all card based. Swipe, play. Swipe, play. 

Gone are the days when you would sit at the table counting quarters out of a ziplok bag to see if you could get that extra cookie or go to the arcade. Kids dont have that physical connection to money anymore and I think it will be a huge detriment when it comes to their future spending and saving habits.  

I have to be careful around my kids and using my CC b/c a few times when my son wants something and I tell him "No, we don't have the money for that" he replies, "Can't you just use your credit card?" 
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You just named many reasons why grooming your kids to never touch cash is a horrific idea.

You are grooming them to be terrible with finances.  Gotta start early.  Kids learn by example.  Set the example.

 
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ghostguy123 said:
You just named many reasons why grooming your kids to never touch cash is a horrific idea.

You are grooming them to be terrible with finances.  Gotta start early.  Kids learn by example.  Set the example.
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Agreed, but I have no control over how the school or D&B handles their cash-less system. 

I said "We' as in the way the world is set up now, not "me" personally. I fixed that in my postif it was confusing

Him answering me like that opened my eyes and now I'm very careful what I buy and how i buy it when he is around. 

 
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parasaurolophus said:
Two types of places where credit card fees are a big burden. Places with mostly small transactions and places that have customers that have accounts with monthly billing. Will likely become the norm at these places barring some changes by CC companies. Everywhere else will likely not move this direction. 
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Education too.  Some schools accept credit card payment because in many cases it's the only way they'll get paid, but the fee on a several thousand dollar tuition bill.  Oof.  Deciding whether to charge a cc fee to the student/parent or not is a difficult decision at many institutions.  Ultimately it largely depends on the demo of their students.

 
rockaction said:
This man knows things. Cash business? Re-porting. 
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I don't do much of it anymore, but my personal training rates have stayed the same because it's all cash.  Clients stay with me at least in part because it's substantially cheaper than the alternative and my per-session take-home is higher than if I were in a more structured setting.  I then take that cash and that's how I try to pay whenever I shop small business - or tip, even if I actually paid with a card.  Just doing my part to help the little guy while giving the finger to the man...even though the man's going to win anyway.  

 
MAC_32 said:
Education too.  Some schools accept credit card payment because in many cases it's the only way they'll get paid, but the fee on a several thousand dollar tuition bill.  Oof.  Deciding whether to charge a cc fee to the student/parent or not is a difficult decision at many institutions.  Ultimately it largely depends on the demo of their students.
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did this with a down payment on my car, I had the $6K cash but figured F-it, let me get some points out of this. Charged it and went to the bank the next day to pay the CC. 

 
Like any other cost of doing business, it should be factored in to their pricing somehow and I just need to consider the total price for whatever I'm buying.

I do think it's a little petty (maybe not the right word) as, e.g. I don't see bars charging more to people who are watching TV than those who aren't or stores charging people for parking etc. Those conveniences are offered because the business owners think the costs are worth the additional business they attract.

If you don't accept credit cards. Chances are, you won't get my business.

OTH, resort fees do bother me.

 
brun said:
Like any other cost of doing business, it should be factored in to their pricing somehow and I just need to consider the total price for whatever I'm buying.

I do think it's a little petty (maybe not the right word) as, e.g. I don't see bars charging more to people who are watching TV than those who aren't or stores charging people for parking etc. Those conveniences are offered because the business owners think the costs are worth the additional business they attract.

If you don't accept credit cards. Chances are, you won't get my business.

OTH, resort fees do bother me.
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Just off the top of my head, I wonder if there is a direct correlation between business who charge CC surcharges and lower margin businesses.  For example, the gas station makes very little on a gallon of gas, so the surcharge makes sense.  A bar is making 15 million percent markup on a bottle of alcohol (rough estimate) so a CC fee doesn't bother them as much.

 
brun said:
Like any other cost of doing business, it should be factored in to their pricing somehow and I just need to consider the total price for whatever I'm buying.

I do think it's a little petty (maybe not the right word) as, e.g. I don't see bars charging more to people who are watching TV than those who aren't or stores charging people for parking etc. Those conveniences are offered because the business owners think the costs are worth the additional business they attract.

If you don't accept credit cards. Chances are, you won't get my business.

OTH, resort fees do bother me.
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Those places likely don't care because typically they are older well established businesses that have a huge client base.  If not they won't be in business for long.

 
jon_mx said:
This is one reason why cryptocurrency will eventually take over.   The overhead associated with credit card transactions is a lot more burden than people realize.   People only see the 1 percent cash back and think that is a lot, but not the 3-5 percent costs added to each transaction.   I am  not sure why people take it out on the businesses which make these costs transparent.  It is your  credit card company who is really charging the fee 
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It will be hard to compete against the current players.  Consumers like their rewards and to be able to easily buy things when they don't have the money.  There is also fraud protection (sometimes for the merchant too!), fraud monitoring, and dispute resolution.  Even if there is a cryptocurrency system developed that merchants and consumers both would accept, all Visa/MasterCard, etc. have to do is lower swipe fees to make merchants stay and make adjustments to other revenue streams to compensate.  

 
We charge a convenience fee for cc payments on rent.  Online check payments are free.  When landlords are looking at returns in the 0-10% range, you can't afford to eat 2.5%.

 
When I owned my insurance agency, we stopped taking cash because of the hassle and security risk.  The clients that complained were the PITA, time consuming types.  

The convenience fee that I hate is when buying movie tickets on-line.  

 
Walking Boot said:
Pretty much if a place isn't charging more for credit transactions, and you pay cash, or, with a card that doesn't get you ~2% rewards/cash back, you're getting screwed a bit. Have to get rewards everywhere now to keep ahead of the vig. 
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I don't even think about a card that doesn't get you at least this.  Opens the door to just paying a lot of stuff and not worrying about whether I'm losing money on the deal.

 
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Want to know what a real scam is? I moved recently, went online to the USPS website to change my address, they asked for a CC and I was like why the hell do they need a CC to change my address? I looked closer and there was a $1.05 fee to change your address.

What in the serious F is that?

 
Mr.Pack said:
Want to know what a real scam is? I moved recently, went online to the USPS website to change my address, they asked for a CC and I was like why the hell do they need a CC to change my address? I looked closer and there was a $1.05 fee to change your address.

What in the serious F is that?
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I just did that too. Fraud protection. It’s probably not 100% but it’s at least a deterrent. I approve. 

 
As the manager of a small business--I absolutely understand it.   Credit cards take a 2-3% processing fee for transactions.   I work in the world of fine jewelry--where you can sell a $100k diamond or watch and the entire profit margin on the sale is maybe 5%.   When asked for pricing on a large ticket item with a very low profit margin--I will tell my clients a check/wire transfer price and tell them that there will be a 3% additional fee if paid via credit card.   It's not me or the business being "greedy"--if a consumer wants to get a "rock bottom" price--they can't and shouldn't expect it if they plan on paying with a method that guarantees the involvement of 2-3% being taken away by a third party entity.   

 
comfortably numb said:
Eh

For a business cash is always a convenience.

It's convenient to not have to pay taxes on all their sales.
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Maybe for a mom and pop where mom or pop are always on the register. Large retail operations with integrated point of sale systems and real-time inventories are not backing out their cash sales and pocketing them.  The amount of effort it would take to make things balance and erase the audit trail wouldn't even be worth it.  Cash is also your biggest exposure in those types of environments requiring many internal controls, so no, it's not a convenience.  

 
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parrot said:
Maybe for a mom and pop where mom or pop are always on the register. Large retail operations with integrated point of sale systems and real-time inventories are not backing out their cash sales and pocketing them.  The amount of effort it would take to make things balance and erase the audit trail wouldn't even be worth it.  Cash is also your biggest exposure in those types of environments requiring many internal controls, so no, it's not a convenience.  
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Good point 

 
glvsav37 said:
did this with a down payment on my car, I had the $6K cash but figured F-it, let me get some points out of this. Charged it and went to the bank the next day to pay the CC. 
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I wanted to do this and the dealer was going to charge a 2.5% fee to use card ☹️

 
I assume the biz is trying to recoup what the credit card company is charging them on the transaction?  I get it.  

Not sure businesses that charge it "get it."

 
We obviously never truly know in most scenarios, but the motivation for why the fee is being put in place does factor in to me.

So if I know the place is struggling and they add some fees, I dont get as annoyed. If they are opening 7 new locations and the owner just bought a private island, yeah, not as cool.     

 
Walking Boot said:
Then there are the hip trendy places that are "no cash, credit card only". Of course with the prices they charge, they're tacking on more than just the transaction fees. 
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When retail places do that, they're basically telling you they don't want homeless or low-income people buying their goods. I won't support a business that does that.

 
Leroy Hoard said:
They should post the 2 prices on an outside sign like gas stations.
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Gas station around the corner posts one price that's about $0.10 lower than across the street. Once you pump you notice that price is only good if you use their gift card that's purchasable only with cash on the night of a full moon and your actual price is $0.25 higher.

I bought gas there once.

 
Ignoramus said:
Gas station around the corner posts one price that's about $0.10 lower than across the street. Once you pump you notice that price is only good if you use their gift card that's purchasable only with cash on the night of a full moon and your actual price is $0.25 higher.

I bought gas there once.
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On top of that the stations with the best price often have the worst gas. I just go to the place I know won't screw up my car and pay the extra dime if I have to.

 
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